Cisco has announced it plans to acquire San Francisco-based Arch Rock Corporation, known as an innovator in Internet Protocol-based wireless network technology for smart-grid applications. Arch Rock will enable Cisco to offer a comprehensive and secure advanced metering infrastructure that is fully IP and open-standards based. The solution facilitates Cisco’s ability to transition the utility industry to an open and interoperable smart grid.

Laura Ipsen, senior vice president and general manager of Cisco’s Smart Grid business unit says, “Arch Rock’s wireless mesh technology enhances Cisco’s IP-based, end-to-end smart-grid offerings. This acquisition further positions Cisco as a strategic partner to utilities working to better manage power supply and demand, improve the security and reliability of energy delivery, and optimize operational costs.”

Arch Rock’s technology allows utilities to connect smart meters and other smart devices over a scalable and secure, multi-way wireless mesh network.  The acquisition of Arch Rock complements Cisco’s recently announced partnership with Itron to develop solutions that enhance smart-metering technology. 

Ticonderoga Securities analyst Brian White told Reuters that “Cisco has been very vocal in characterizing the smart grid opportunity as at least as big as or ‘eclipsing the size of’ the Internet opportunity. Longer term, we believe the smart grid transition could meaningfully increase the company’s overall addressable market opportunity.” The wire service also noted that Cisco has identified $20 billion in opportunities in the next five years.

By acquiring Arch Rock, Cisco inherits a leading research and development team that has produced innovative wireless networking for smart-grid applications. After the deal closes, the Arch Rock R&D team will be assimilated into Cisco’s Smart Grid business unit. Financial terms of the transaction are undisclosed. The acquisition is subject to typical conditions and is expected to be finalized by the end of 2010.

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